Michael Somerset-Leeke, the former stockbroker who has twice been subject to
regulatory investigations and once banned from trading for three months, has
emerged as the major force behind listed mining group Papua Mining.

Papua Mining is an Aim-listed group with exploratory mining rights in Papua New GuineaPhoto: AFP

Mr Somerset-Leeke is the founder and 20.4pc shareholder in Papua Mining, an Aim-listed group with exploratory mining rights in Papua New Guinea. The company owns 14 licences across Ambunti and New Britain, some of which are only accessible by "dugout canoe", according to company documents.

As well as being the founding shareholder, the Monaco-based businessman is the second largest investor in Papua Mining behind South Pacific Mining Holdings (SPMH), which has a 31pc stake.

Company documents give no indication as to who or what is behind SPMH other than a trust company incorporated in St Kitts and Nevis.

A spokesman for Papua said SPMH had no link to Mr Somerset-Leeke.

The emergence of Mr Somerset-Leeke as a major shareholder of a publicly-listed company comes 19 years after the DTI concluded an investigation into suspect trading involving Mr Somerset-Leeke, a number of other investors and engineering group Suter.

The investigation into concerns over potential concert party trading found nothing wrong but did recommend that rules governing concert parties be changed.

Eight years prior to this, after a separate regulatory investigation, Mr Somerset-Leeke was censured by the Stock Exchange Council for improperly handling deals on behalf of clients. He was banned from trading for three months.

Both actions took place while Mr Somerset-Leeke was the senior partner of stockbroker Coni Gilbert & Sankey. The company no longer exists. Mr Somerset-Leeke is not currently registered with the Financial Services Authority as an authorised person.

Despite his large shareholding in Papua Mining Mr Somerset-Leeke is not a director of the mining group. Its chairman is Michael Gordon Jolliffe, a ship-broker by background. The chief executive is Hugh McCullough, a project geologist and former chief executive of Glencar Mining.

The company has reported a number of the areas over which it has licences have already shown promise in gold and copper deposits. Papua raised £7m through floating 50pc of its shares on Aim last week. The shares floated at 44p. On Monday they closed at 60.1p.